Correlation Between Sabra Healthcare and Global Medical
Can any of the company-specific risk be diversified away by investing in both Sabra Healthcare and Global Medical at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Sabra Healthcare and Global Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Sabra Healthcare REIT and Global Medical REIT, you can compare the effects of market volatilities on Sabra Healthcare and Global Medical and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Sabra Healthcare with a short position of Global Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of Sabra Healthcare and Global Medical.
Diversification Opportunities for Sabra Healthcare and Global Medical
0.16 | Correlation Coefficient |
Average diversification
The 3 months correlation between Sabra and Global is 0.16. Overlapping area represents the amount of risk that can be diversified away by holding Sabra Healthcare REIT and Global Medical REIT in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Global Medical REIT and Sabra Healthcare is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Sabra Healthcare REIT are associated (or correlated) with Global Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Global Medical REIT has no effect on the direction of Sabra Healthcare i.e., Sabra Healthcare and Global Medical go up and down completely randomly.
Pair Corralation between Sabra Healthcare and Global Medical
Given the investment horizon of 90 days Sabra Healthcare REIT is expected to generate 0.9 times more return on investment than Global Medical. However, Sabra Healthcare REIT is 1.11 times less risky than Global Medical. It trades about 0.08 of its potential returns per unit of risk. Global Medical REIT is currently generating about 0.02 per unit of risk. If you would invest 1,088 in Sabra Healthcare REIT on August 27, 2024 and sell it today you would earn a total of 753.00 from holding Sabra Healthcare REIT or generate 69.21% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Sabra Healthcare REIT vs. Global Medical REIT
Performance |
| Timeline |
| Sabra Healthcare REIT |
| Global Medical REIT |
Sabra Healthcare and Global Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Sabra Healthcare and Global Medical
The main advantage of trading using opposite Sabra Healthcare and Global Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Sabra Healthcare position performs unexpectedly, Global Medical can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Global Medical will offset losses from the drop in Global Medical's long position.| Sabra Healthcare vs. Healthcare Realty Trust | Sabra Healthcare vs. Healthpeak Properties | Sabra Healthcare vs. Community Healthcare Trust | Sabra Healthcare vs. Universal Health Realty |
| Global Medical vs. Healthpeak Properties | Global Medical vs. Ventas Inc | Global Medical vs. National Health Investors | Global Medical vs. Sabra Healthcare REIT |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Bond Analysis module to evaluate and analyze corporate bonds as a potential investment for your portfolios..
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